Michigan's Circuit Court for the 30th Judicial Circuit in Ingham County has approved a preliminary injunction against Kalshi, blocking the prediction markets platform from offering event contracts to state residents. Attorney General Dana Nessel announced the Wednesday order, stating that Kalshi faces potential fines of up to $500,000 per day for violations.
Nessel filed the original lawsuit against Kalshi in March, alleging that the platform violated state law on sports gambling. "Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices," Nessel said.
The preliminary injunction follows a June restraining order from a Michigan court that similarly barred Kalshi from offering sports betting to residents. The US Commodity Futures Trading Commission (CFTC) has ordered Kalshi not to comply with the state order and continue operating, creating conflicting regulatory directives for the company.
The Michigan action is part of a broader legal conflict between prediction market platforms and US state authorities. Similar lawsuits have been filed across multiple states, with jurisdictional questions at the center of the dispute.
Supreme Court Petition Filed
On the same day Michigan's order was announced, New Jersey officials filed a petition for a writ of certiorari to the US Supreme Court regarding their case against Kalshi. Legal experts suggest the case could resolve competing theories about whether the CFTC or state authorities hold jurisdiction over prediction markets.
"[I]t would be reasonable for the Supreme Court to take it up, but they also may wait for the cases to be decided on the merits and not simply procedural issues like granting a preliminary injunction or not," said Melinda Roth, a visiting professor of practice at New England Law in Boston. Roth added that if the Supreme Court hears the case, it will likely determine whether sports event contracts fall under federal CFTC regulation or state authority.
Congress may also address the issue through legislation. In March, Senators Adam Schiff and John Curtis introduced a bill to prohibit platforms registered under the CFTC from listing event contracts that "resemble a sports bet or casino-style game," referring jurisdiction to individual states.
